The Working Party’s Report on the Measurement of International Capital Flows described problems that arise because offshore financial centers (OFCs) omit from their balance of payments the large volumes of financial flows that pass through their entrepôt facilities.1 OFCs are small countries that consider these flows to be unrelated to activities in their own economies and inappropriate for their balance of payments statements. Also, some OFCs do not prepare balance of payments statements at all. As a result, capital flows in the Fund’s Balance of Payments Statistics Yearbook do not include most financial transactions of OFCs.